Wednesday, June 5, 2013

Bank on education

    Sen. Elizabeth Warren, D-Mass., is not your everyday freshman senator. From the time she entered office, she has been unwilling to allow banks and bankers to have unquestioned power over our lives.
    Refusing to make students into a profit center, she has introduced the Bank on Students Loan Fairness Act, which would allow students to borrow funds at the same low rates as banks now get on funds they borrow from the Federal Reserve.
    Warren has frustrated many on the right because she refuses to proclaim the virtue of the mega-banks that destroyed millions of jobs and nearly broke the nation’s economy. Now the same banks feel they deserve to charge students interest rates that are nine times higher than the rates paid to the government by the biggest banks.
    On July 1, interest rates on new subsidized Stafford student loans are set to rise from 3.4 percent to 6.8 percent and Warren is unwilling to look the other way, especially when banks are treated with kid gloves by the government.
    For Warren, it is valuable not only for an individual but for the entire nation to have an educated citizenry. It only makes sense to strive for success by getting an education, however, if it can be achieved without forcing students to take on a lifetime of debt.
    Warren believes the nation should be investing in higher education to strengthen our economy and grow the middle class. If Congress doesn't act to stop loan rates from rising, students would rack up an additional thousand dollars annually in debt. “That's like a thousand dollar tax hike,” she notes.
    We have held to the belief for a long time that a college education is the key to a middle-class life. But now the size of student-loan debts makes the promise of a middle-class life less certain.
    “Young people are delaying buying homes. Families are crushed by student-loan debt,” Warren says.
    Meanwhile, House Speaker John Boehner has been accusing President Obama of practicing what he labels “petty partisanship.” The partisanship that the president is being accused of is trying to make it possible for students to attend college without having to indebt themselves for the rest of their lives.
    “Big banks get a great deal when they borrow money from the Fed,” Warren says. “We should make the same kind of investment in young people who are trying to get an education.”
    It’s an investment the nation should bank on.

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